The similarity system

Hi Eurusdd,

Can we predict WHEN it will reach that value ? If it reach that level today, may be after "Existing Home Sales" fundamental news, the price will fall down ?

Thanks

Smallcat, you won't find it at Forexfactory. As I said I get market info from other banks, it's part of my job. My point was to highlight the fact they were making the same call as EURUSDD, 1.3205.

Daz.

Here we go!!

Thank you is all I can say and offer right now. Thank you to EURUSDD and all other members on this thread for their great contribution and their desire to help others.

Further this message is more of directed towards Vlady. First of all thank you for going to great lengths to carve out the steps to identify the tops and bottoms using ZZ-BB-Stoch. I am finding it really helpful and I have adapted it after doing a few alterations to make it mine. I plan to invest a few weeks of my life to this method as I finding lot of value in it. But before I do go forward I would just like to recap and get a confirmation from Vlady about the steps, so that at least I am in sync with the latest of this strategy. The basic principle as I understand for the BB-Stoch-ZZ method is as follows:

Main concept: The yellow zigzag line must always(97%) appear after the red 1EMA touches the upper/lower BB.

Two cases can be found:
- When yellow zigzag appears and red 1 EMA has not hit the outer band. In this case the price will travel in the same direction until the red 1 EMA hits the outer band. Expect the ZZ to repaint in the same direction.
- When red 1 EMA has hit the outer band and the Zig zag does not appear. In this case the price will turn back and continue in the previous direction towards the other outer BB band.

Confirmation of a Swing TOP/BOTTOM:
At a swing TOP following must be satisfied -
• Price should be marked by the ZigZag
• Price should be outside the BB
• Stoch should be outside the Sotch BB in bottom window
• Price should cross the BB Midline AFTERWARDS

Vlady can you please confirm the above mentioned points. EURUSDD can you also please share your thought on this.

I want to master one of the basic methods first before diving deeper into Similarity and DS concept.

Once again thank you to every participant on this thread.

Ravs

Ou ... I see ... it's a kind of term used by a bank .... Thank U.

I Just banned you IFxRobot!!!

dis-similarity starting on Euro and GBP!!

watch my eurusd sentiment - my signature!!

Great ..... I found it. I will watch my trade in these 2 days ..... Thank U very much Eurusdd ...

Thank you so much Eurusdd for opening my eye!!

Bradu; you too!!! I don't need your attention!
I don't CHASE price, why would I chase you for your attention. If you don't make good relevant contributions I will not let you destroy our platform

No. I did not open your eyes. They are already opened. I simply "helped" you look the right way!




I will take my profit now!!!

You Sure did....

Dammit.. impromptu meeting made me miss the move I was looking for.

Anyway, here's an example of why ZZ is still not perfect because it still relies on judgement. This is on 15M. When I get this kind of uncertainty, I go down to the 5M timeframe.... but I'll leave that analysis to the side and show you what I mean on the 15M.

Below you'll see that the sequence on the 20th July on my charts show that a ZZTOP was due.

The first case, price even crossed the ZZMID but the next bar closed back above it... to me that smelled trouble, no trade. Also... forgetting all the Similarity stuff... use your other trading knowledge: the price was going sideways and above R1... not an up/down trend.... so caution was the key.

It then shot up, cancelling the previous ZZTOP and creating a new one. The close wasn't outside the BB though. What to do? Can't remember if I traded this using the 5M or not. What if I treated it as a swing... what do I expect next? ZZBOT. But it only created a tail that was outside the BB, not a close outside BB. Is that a ZZBottom? Based on my rules it's not.... but step back for a second... isn't it marvellous that for the first time ever in my trading - all I am worried about is what sequence swing it is. I'm not worried about price as much. It's freedom! If you miss it (and sometimes that hurts) there will always be another swing.

Now I think that was last night actually before bedtime. I wasn't sure of the 15M so I used the 5M and it gave a proper ZZBOT so I took it.

Today, we enter full volume with Asia and we have a True ZZTOP. The ZZBOT was therefore expected and I traded that up. The next sequence was ZZTOP but notice that there was confusion near the MID. At least 4 bounces.... but then I was pulled away into the meeting. I had watched 2 bounces at the time and was loooking for a LONG around the mid.

Now that 1.3189 has formed, could this be a ZZTOP? Let's see if it breaks mid. Also.... remember the shape of the Bollinger. For it to be able to break the lower band, the Bollinger must draw properly and close to price.... right now that's elasticated way south. Expect price to range now until NYC for the Bollinger to catch up. If it spikes down suddenly you can long the shit out of it because we could have a target of 3200.

Am I applying my rules 100% as a mechanical system? Or am I using the rules as a chess pieces in a game? Sometimes I win, sometimes I lose (yes that continues, but I limit risk). All you "automated system hunters" should take note.

Just doing my job then - helping folks turn red into green.

The system we have - ZZ included - is the closest to NEAR-perfection, I have ever seen or used. It is a beast! Look at ZZ closely, real close!

For your information: DO not second-guess 1.32. They will take it out!!!

Hopefully he will be able to open your other one too

lol.... I only have one eye!!

nah typing to fast while trading... that did make me lol!!

1.32 is a done-deal. They need to take price there! There is NO OTHER WAY for price!!!!! buy dips! In post

1. Post# 3,667 (http://www.forexfactory.com/showthread.php?p=6836194#post6836194) I said that region had to go! It is gone!!!

Hey RAVS!

Cheers for following this up. Let me answer in red:

Main concept: The yellow zigzag line must always(97%) appear after the red 1EMA touches the upper/lower BB.
I prefer to state it as.... PRICE must appear outside of BB in sequence on the 15M. It's better for the CLOSE of one bar to be outside. But sometimes a tail can be a weak ZZ. When it's weak, it's still pushing that BB isn't it but the 15M may be too big for it so I switch to a 5M.... that means your trade time horizon has to change also (hint!) but the resolution of the price (close and tails) will most likely be outside of BB to give proper ZZ swings.

Unfortunately, I have to add my disability of not having MT4 when I am trading. So I don't have a 1EMA inside a BB as a 2nd chart to compare PRICE. I wish I had because yes, I do check for both PRICE/BB and STOCH/BB to be outside BB as a strong ZZ signal. But since I can't, I am eyeballing it.

Two cases can be found:
- When yellow zigzag appears and red 1 EMA has not hit the outer band. In this case the price will travel in the same direction until the red 1 EMA hits the outer band. Expect the ZZ to repaint in the same direction.
- When red 1 EMA has hit the outer band and the Zig zag does not appear. In this case the price will turn back and continue in the previous direction towards the other outer BB band.

I also found these cases. Don't know if we're looking at the same thing. One was near top that created the 3200 and 3158 black hole.
These are exceptions. I welcome you to come up with rules for this because I haven't been able to as of now.

Confirmation of a Swing TOP/BOTTOM:
At a swing TOP following must be satisfied -
• Price should be marked by the ZigZag
• Price should be outside the BB
• Stoch should be outside the Sotch BB in bottom window
• Price should cross the BB Midline AFTERWARDS

I think I amended this later on to account for different levels of aggression. This also means different levels of success. Use as flavourings.
If you're aggressive, at times I have traded as soon as price closes back into BB. Have I lost? Yes. Have I won? Yes. Flavour. Risk management.
If I am conservative, I may enter after price has worked out what it wants to do at BB Mid.

This is where Non Sim trading (experience or what have you) kicks in. FIBS, Pivots, Rumour, Whatever you can use to give you reasons to trade or not trade.

Until I get a fully blown MT4 at work, I can't trade the full system as per what you guys are seeing on MT4.
Having said that, the rules above are principles or structures that I am able to work within. I'm not even worrying about DS Zones... although when you know they are there... I have used them as support zones. I'm relying on Tapot to put out charts!

I must admit that having Eurusdd make the call of 3208 is alot more comforting. I had the opinion that this zone was NOT going to be cleared first before the bottom... but then this whole technical issue about 3158 made me think that it has to go for it. Eurusdd made it easier. So let me acknowledge the help there!